News

Consolidated Sales of Olainfarm in Six Months Exceed 53 Million

on August 31, 2016

Unaudited financial reports of JSC Olainfarm for six months of 2016 show that consolidated sales of the Company reached 53.5 million euros, which represents an increase by 7% compared to the first half of 2015. Therefore, this is yet another sales record. Net profit for the period was 6.1 million euros, which represents a reduction by 34% compared to the same period one year ago. During these six months, provisions of two million euros have been made for Ukrainian receivables. Major sales markets of JSC Olainfarm during this period were Russia, Latvia, Ukraine and Belarus.

„One of the main strategic activities of ours is to use our marketing and logistics experience to facilitate growth of our daughter companies in their existing and new markets. In order to strengthen the positions of Tonus Elast in Russia we just registered our fully owned daughter company Elast Medikl there. It will be exclusive importer and distributor of Tonus Elast in Russia,” says Valerijs Maligins, Chairman of Olainfarm’s Board.

During the first half of 2016, sales to most of Company’s key markets continued growing, except Ukraine, where they fell by 7% compared to six months of 2015, and Kazakhstan, when they fell by 12% during the same period. Since during the second quarter sales to Russia increased again, Russia has again become the largest market for the Company with 30% share in total sales. During six months of 2016, significant sales increase has been achieved in Italy, where sales grew by 194%, Uzbekistan, where sales grew by 134% and Turkmenistan, where sales grew by 97%. Major sales markets of JSC Olainfarm in first half of 2016 were Russia, Latvia, Ukraine and Belarus. In total during six months of 2016 Olainfarm’s products were sold to 38 countries in 4 continents.

During the first half of 2016 significant changes have occurred to the structure of bestselling products, as Neiromidin has again become the bestselling product with 17% share in total sales. Sales made during the second quarter have brought Furagin back to ten bestselling products replacing Remantadin. Overall concentration of sales has remained unchanged, as ten bestselling products make up only 89 % of sales.

Annual meeting of shareholders of JSC Olainfarm convened on June 7, 2016 approved operating plan of the Group for 2016. According to it, sales of the Group in 2016 are planned to be 100 million euros, but the net profit will reach 10 million euros. According to this unaudited report for 6 months of 2016, during this period 54% of annual sales target and 61% of annual profit target is met.

Condensed Consolidated Statement of Financial Position

Group

30.06.2016

31.12.2015

EUR ‘000

EUR ‘000

ASSETS

NON-CURRENT ASSETS

Intangible assets

28 339

20 591

Property, plant and equipment

38 513

35 579

Financial assets

4 530

4 917

TOTAL NON-CURRENT ASSETS

71 382

61 087

CURRENT ASSETS

Inventories

23 770

20 990

Receivables

38 197

30 480

Cash

3 656

5 574

TOTAL CURRENT ASSETS

65 623

57 044

TOTAL ASSETS

137 005

118 131

EQUITY AND LIABILITIES

EQUITY

Share capital

19 719

19 719

Share premium

2 504

2 504

Reserves

322

322

Retained earnings

69 335

65 773

Non-controlling interests

35

30

TOTAL EQUITY

91 915

88 348

LIABILITIES

Non-current liabilities

Borrowings

19 367

8 560

Deferred corporate income tax

2 295

1 947

Deferred income

3 030

2 656

Total Non-Current Liabilities

24 692

13 163

Current liabilities

Borrowings

6 590

4 258

Trade payables and other liabilities

13 314

11 562

Deferred income

494

800

Total Current Liabilities

20 398

16 620

TOTAL LIABILITIES

45 090

29 783

TOTAL EQUITY AND LIABILITIES

137 005

118 131

Consolidated statement of comprehensive income

Group

Group

Q2 2016

Q2 2015

6M 2016

6M 2015

EUR ‘000

EUR ‘000

EUR ‘000

EUR ‘000

Net revenue

27 387

23 045

53 517

50 069

Cost of goods sold

(10 412)

(8 052)

(20 320)

(16 242)

Gross Profit

16 975

14 993

33 197

33 827

Selling expense

(7 779)

(6 375)

(14 624)

(13 443)

Administrative expense

(4 584)

(4 135)

(9 050)

(8 302)

Other operating income

891

522

1 496

936

Other operating expense

(2 496)

(1 877)

(4 251)

(3 335)

Share of profit of an associate

22

23

39

95

Income from investments in subsidiaries

–

–

–

–

Financial income

1 042

268

1 299

2 258

Financial expense

(69)

(55)

(109)

(111)

Profit Before Tax

4 002

3 364

7 997

11 925

Corporate income tax

(1 081)

(738)

(2 095)

(2 510)

Deferred corporate income tax

82

(21)

214

(135)

PROFIT FOR THE REPORTING PERIOD

3 003

2 605

6 116

9 280

Other comprehensive income for the reporting period

–

–

–

–

Total comprehensive income for the reporting period

3 003

2 605

6 116

9 280

Total comprehensive income attributable to:

The equity holders of the Parent Company

3 003

2 605

6 111

9 276

Non-controlling interests

–

–

5

4

Basic and diluted earnings per share, EUR

0.21

0.18

0.43

0.66

JSC Olainfarm is one of the biggest pharmaceutical companies in Latvia with more than 40 years of experience in production of medication and chemical and pharmaceutical products. A basic principle of company’s operations is to produce reliable and effective top quality products for Latvia and the rest of the world. Products made by the Group are being exported to more than 40 countries of the world, including the Baltics, Russia, other CIS, Europe, Asia, North America and Australia.